I'm a gasoline distributor licensed in Ontario, Canada. Can I buy gasoline in New York State tax-free if I'm exporting it straight to Ontario for resale there?

Plain-English summary

BJB Fuel Co., a gasoline importer/distributor licensed in Ontario, Canada, asked whether it could buy gasoline in New York State without paying the New York motor fuel excise tax (Tax Law §§ 284, 284-a, 284-c), given that it planned to immediately export the fuel to Ontario for resale to wholesalers and retailers there.

New York's own statute only expressly covers domestic export sales: a New York distributor can sell gasoline tax-free (and later claim a credit or refund) to a buyer who is a licensed distributor in another U.S. state, immediately exporting the fuel to an identified facility there. There's no statutory language extending that specifically to Canadian provinces. But the Department confirmed it is the policy of the Tax Commission to extend the same tax-free treatment to distributors duly licensed by Canadian provincial taxing authorities.

For Ontario specifically, there's a wrinkle: Ontario doesn't license motor fuel distributors the way New York does. Instead, the Ontario Ministry of Revenue can appoint a gasoline reseller as a "collector" under section 6 of the Gasoline Tax Act. The Department said it will treat that provincial collector appointment as the equivalent of a "duly licensed distributor" for purposes of the New York export exemption. Because Ontario doesn't issue a formal license document to collectors, a letter from the Ministry of Revenue's Motor Fuels and Tobacco Tax Branch confirming the appointment is acceptable proof. The tax-free purchase right ends immediately if that Ontario appointment is ever suspended or revoked. To actually get the tax-free treatment, the buyer must give its New York supplier a copy of the Ministry appointment letter, plus a properly completed Statement of Exportation of Motor Fuel by Purchaser (Form FT-936) for each purchase.

What this means for you

Gasoline and motor fuel distributors selling for export to Canada

You can sell gasoline tax-free in New York to a Canadian buyer immediately exporting it home, but only if you collect the right paperwork first: proof the buyer is an appointed collector (or the equivalent) under its home province's fuel tax law, and a completed FT-936 for each transaction. This ruling is the origin case the Department later applied (and found NOT satisfied on incomplete paperwork) in TSB-A-89(1)M.

Ontario or other Canadian fuel buyers purchasing in New York

Get your Ministry of Revenue appointment letter (or your province's equivalent licensing/appointment document) in hand before you buy, and provide it — along with a Form FT-936 for each purchase — to your New York supplier. Without both, your supplier may have to charge you tax it can't later refund.

Common questions

Q: Does New York's fuel-tax law say anything specific about Canadian provinces?
A: No — the export exemption's text covers licensed distributors of other U.S. states. The extension to Canadian provincial distributors is a matter of Tax Commission policy, not statutory text.

Q: How does an Ontario reseller prove it qualifies, since Ontario doesn't issue distributor licenses?
A: A letter from the Ontario Ministry of Revenue, Motor Fuels and Tobacco Tax Branch, confirming the reseller's appointment as a "collector" under section 6 of the Gasoline Tax Act is acceptable in place of a formal license.

Q: What happens if the Ontario collector appointment is later revoked?
A: The right to purchase gasoline tax-free in New York terminates immediately upon suspension or revocation of the distributor's/collector's appointment.

Q: Can I rely on this ruling for my own purchases?
A: No. This advisory opinion binds the Department only as to the petitioner and the specific facts described.

Citations and references

Statutes:

• Tax Law § 284 (excise tax on gasoline imported/produced in New York)
• Tax Law § 284-a (additional gasoline excise tax)
• Tax Law § 284-b (authorizes cities of 1M+ population to impose a similar tax)
• Tax Law § 284-c (supplemental gasoline excise tax)

Related opinions

• TSB-A-89(1)M — a later ruling applying this same Ontario-export policy, where a seller was left owing tax because the buyer's exemption documentation failed to establish valid Ontario collector status.

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/gasoline_ao.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/fuel/a87_2m.pdf

Original ruling text

New York State Department of Taxation and Finance
TSB-A-87 (2) M
Motor Fuel
June 12, 1987

Taxpayer Services Division
Technical Services Bureau
STATE OF NEW YORK
STATE TAX COMMISSION
ADVISORY OPINION

PETITION NO: M870204A

On February 4, 1987, a Petition for Advisory Opinion was received from BJB Fuel Co., 3
Welkin Gate, Etobicoke, Ontario M9C3L1.
The issue raised is whether Petitioner may purchase gasoline within New York State
exclusively for purposes of export to, and distribution in, the Province of Ontario, Canada without
payment of the motor fuel tax imposed under Article 12-A of the Tax Law.
Petitioner states that it is engaged in the business of importing gasoline into the Province of
Ontario for sale to motor fuel wholesalers and retailers. Petitioner also states that it is duly licensed
with the Ontario Ministry of Revenue, Motor Fuels and Tobacco Tax Branch pursuant to the
Gasoline Tax Act of 1981 and has been certified by the Ontario Ministry of Consumer and
Commercial Relations, Fuels Safety Branch as a distributor/dealer of motor fuel and gasoline in the
Province of Ontario.
Sections 284, 284-a and 284-c of the Tax Law impose excise taxes upon gasoline imported
into or caused to be imported into New York by a distributor for use, distribution, storage or sale in
the state or upon gasoline which is produced, refined, manufactured or compounded by a distributor
in the state.
Section 284-b of the Tax Law also authorizes any city in the state having a population of one
million or more to enact a similar tax.
Under the Tax Law, a New York distributor must pay the motor fuel tax upon importing
gasoline into the state and must pass such tax through to its customers upon selling the gasoline.
However, a New York distributor is allowed to sell gasoline tax free and to take a credit or a refund
of the amount of tax required to be paid on such gasoline under circumstances where the gasoline
is sold within New York State to a purchaser who is a duly registered or licensed distributor of, or
dealer in, motor fuel in another state and who will immediately export such fuel to an identified
facility in that state for the purpose of selling such gasoline.
While there is no specific provision of the Tax Law allowing tax free purchases by
distributors licensed by the provinces of Canada, it is the policy of the Tax Commission to extend
the same privileges to distributors duly registered or licensed by the taxing authorities of the
provinces of Canada.

RODERICK G. W. CHU, COMMISSIONER
TP-8 (3/83)

FRANK J. PUCCIA, DIRECTOR

GABRIEL B. DiCERBO, DEPUTY COMMISSIONER

-2­
TSB-A-87 (2) M
Motor Fuel
June 12, 1987

It is noted that the Province of Ontario does not issue licenses to motor fuel distributors in
a manner similar to that employed by the State of New York pursuant to the Tax Law. However, the
Ontario Ministry of Revenue is authorized to appoint any person who is selling gasoline for resale
in Ontario to be a collector under section 6 of the Gasoline Tax Act. The State of New York will
recognize a gasoline distributor appointed as a collector under section 6 of the Gasoline Tax Act by
the Ministry of Revenue, as a duly licensed distributor for purposes of purchasing gasoline tax free
in New York State for immediate export to an identified location in Ontario for the purposes of
selling such gasoline. Inasmuch as the Ministry of Revenue does not issue licenses to such
collectors, a letter issued by the Ontario Ministry of Revenue, Motor Fuels and Tobacco Tax Branch
appointing a distributor as a collector under section 6 of the Gasoline Tax Act will be acceptable as
proof of such appointment.
A distributor's right to purchase tax free will terminate if the distributor's appointment as a
collector is suspended or revoked.
Accordingly, as long as Petitioner is authorized by the Ministry of Revenue to be a collector
under section 6 of the Gasoline Tax Act, it will be recognized by the State of New York as a
distributor licensed in the Province of Ontario and will be authorized to purchase gasoline tax free
for immediate export to an identified facility in Ontario for the purposes of selling such gasoline.
To effectuate a tax free purchase, Petitioner should furnish to each of its suppliers a copy of
the letter of the Ministry of Revenue appointing Petitioner as a collector under section 6 of the
Gasoline Tax Act. Additionally, Petitioner must furnish to its supplier a properly completed
Statement of Exportation of Motor Fuel By Purchaser (Form FT-936) for each purchase of gasoline.

DATED: June 12, 1987

s/FRANK J. PUCCIA
Director
Technical Services Bureau

NOTE: The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.